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PSC's Latest Direction For POR Discount Calculation Results In 11% Discount
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Pepco in the District of Columbia has filed its latest revision to the residential purchase of receivables (POR) discount rate, using the latest methodology directed by the D.C. PSC
See our prior story for the direction that the PSC recently ordered to be used for Pepco's residential POR discount rate calculation
The calculation ordered by the PSC results in an 11.3079% residential POR discount for Pepco-DC, proposed to be effective May 1, 2025
While lower than the discount rate of nearly 15% that would result from the standard calculation methodology, the new POR discount is still nearly 3 times higher than the current residential discount of 3.9807%
Under Pepco's newly filed 11.3079% residential POR discount, the uncollectibles factor is "only" 3%, while the main driver of the eye-popping discount is an 8% reconciliation factor.
The discount rates for all of the non-residential classes are proposed to be updated to 0%, which reflect the zero-ing out of negative discounts which result from the standard POR discount calculation. Negative discount rates for C&I customers, absent the zero-ing out, largely reflect otherwise due reconciliations of prior POR over-collections under the reconciliation component, and, to a lesser extent, a net negative uncollectibles component due to the application of late payment fee revenues to offset uncollectibles
The current small C&I POR discount is 0.7765%, and its downward adjustment to 0% has been held up as the residential discount change has been pending since May 2024. The current large C&I discount is 0%
As previously reported, the PSC recently said that no POR costs should be borne by non-shopping customers.
However, the PSC also noted that while the residential POR program has a high under-collection balance (resulting in the 11% discount), the non-residential classes generally show over-collections under POR. As noted above, the non-residential POR discounts currently do not return any over-collections to suppliers through a negative discount
As previously reported, the PSC has indicated that it will invite comment on the future of the POR program at both Pepco and WGL
PEPPOR-2024-01, PEPPOR-2025-01
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March 17, 2025
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Copyright 2025 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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